Organising economic information
In view of the large amount of data available, it is sensible to organise the information in some way. The Bank of England's Inflation Report and the minutes of the MPC meetings are organised around different aspects of the economy.
The Inflation Report is organised under headings that reflect different elements of the inflation process - from the money supply, exchange rates and interest rates, to the amount being spent in the economy and the rate of output growth, to the effects on activity in the labour market and costs and prices. These are the various stages of the links between interest rates and inflation - the transmission mechanism - outlined in the Inflation section.
This basic structure is followed in The Economy section, which provides teams with a selection of key economic data. The headings are:
money and financial markets;
demand and output;
the labour market;
costs and prices.
Teams will want to look through The Economy section and familiarise themselves with each of these areas of the economy. Of course, the way that teams structure and organise their presentations need not follow these headings. The judges will be looking for imaginative formats. For the purposes of working through the economic information, this is a logical way of thinking about inflation and interest rates. But you should still base your interest rate decision on an assessment of the outlook for the economy as a whole, not of particular aspects of it - such as the labour market.
This section has provided some general guidance to prepare you for using the economic statistics included in the Data section. It is important to understand the nature of the information that you will be dealing with.
©2000-2009 Bank of England.
